How to market your ICO in Africa

Initial coin offerings (ICOs) – which involve companies creating and issuing their own tokens, which are then bought by the public – are all the rage.

As companies all over the world seize on a new – and unregulated – way of raising money, away from the difficulties of VCs and due diligence. Some have seen extraordinary success, like Tezos, which raised US4232 million, and Bancor, which raked in US$153 million. Vinny Lingham’s Civic raised US$33 million over a 2017 that saw hundreds of companies raise billions of dollars through ICOs.

Will the ICO effect hit Africa? It already is to some extent, with the recent success of SureRemit following hot on the heels of smaller raises by Wala and ProsperiProp. Disrupt Africa reported yesterday how blockchain-based gaming startup Gron Digital is also looking to get in on the act.

In Africa, even more so than the rest of the world, convincing potential investors of the merits – and security – of buying your tokens is key to a successful ICO. So what are the best ways of going about marketing coin offerings in order to achieve the best possible result.

According to Tricia Martinez, chief executive officer (CEO) of Wala, it is also about trust, transparency, and community.

“These are the three most important elements of a successful token sale and unfortunately that applies for real companies with a solid use case and a few guys with an idea,” she said. “For the crypto community we quickly recognised that in order to gain trust you must be transparent. Like an open book, share everything. All the ups and downs of your business, your background, the team… And the only way to build a community is by being transparent.”

Once Wala – which secured only four per cent of its ICO target but still secured US$1.2 million – gained the trust of the individual and was transparent, its community began to grow.

“We put together multiple explainer videos, interviews, webinars, research papers, PR announcements. The traction and buzz you build on your name creates FOMO (Fear of Missing Out), and FOMO is a very good thing in the crypto world,” Martinez said.

Adeoye Ojo is co-founder of SureRemit, the Nigerian fintech startup whose recent US$7 million raise was the biggest by an African startup through an ICO so far. He agreed releasing as much information as possible to build a community was key.

“We put the story out there, released videos and documents explaining the project. Interested participants found it, sent emails, joined our telegram group and participated. I think what helped the most was that we are trying to solve a real problem,” he said.

For Llew Morkel, CEO of South African property investment platform ProsperiProp, building a community of people that in turn can become ambassadors for the project is important. ProsperiProp raised US$200,000 via its ICO, well below its target, but Morkel said the company had learnt important lessons after being forced into a rethink halfway through.

“The best way to market your ICO is through user support. Build your tech, burn the midnight oil, spend your weekends and every spare moment creating your solution. Once created get people to use it. Every person that finds your system useful is a potential sales person,” he said.

“Get involved in communities, get them involved in your product. People are inherently lazy – most will never read your whitepaper. But if a friend recommends your system passionately there is a nine out of ten chance of a sale.”

“It doesn’t work. People have grown so tired of ICO advertising that they block it out. Focus on building a following through communities. People invest in people, get your team involved and speak to every person that is willing to listen,” he said.

“Lastly, if you do have money to advertise, consider advertorials in industry leading online magazines like Disrupt Africa. Hire a good PR firm.”

Though Morkel believes crowdfunding offers a great means of generating capital, he thinks ICOs in their current form will soon cease to exist.

“We are seeing regulatory bodies of First World governments like the US SEC clamp down on ICOs that offer an investor return. The ICOs of the future will only be possible if it follows rigid compliance and verification processes,” he said.

“Countries like America, Canada, China, the UK and South Korea – where most of the personal venture capital lies – will not allow an ICO to be marketed in their country if it does not meet their compliance criteria.”

About Author

Passionate about the vibrant tech startups scene in Africa, Tom can usually be found sniffing out the continent's most exciting new companies and entrepreneurs, funding rounds and any other developments within the growing ecosystem.